Governor Wolf: Legalization Of Adult-Use Cannabis Can Lead To Economic Gains And Restorative Justice For Pennsylvanians

PENNSYLVANIA:  Governor Tom Wolf visited The Mountain Center in Tobyhanna, Monroe County today to talk about the economic growth potential and restorative justice benefits of legalizing adult-use cannabis, something the state General Assembly has not yet done despite multiple requests from the governor and Lieutenant Governor John Fetterman to take up legislation this fall.

“This year, I again went to the General Assembly and asked them to make legalizing adult-use cannabis a priority for the fall as we work to find ways to overcome the economic hardships of the COVID-19 pandemic,” Gov. Wolf said. “To date, there has been no movement to advance legislation. So, I’m here today to ask again, and to focus on two particular benefits of legalization – potential economic growth and much-needed restorative justice.”

The governor described how legalizing adult-use cannabis offers the same potential for economic growth that the historic farm bill of 2018 did for hemp farming after decades of government prohibition of the industry.

Hemp was once a widespread crop in Pennsylvania, cultivated in the commonwealth for more than 250 years and grown for seeds, fibers and extracts. Though they look similar, the governor was quick to point out that hemp is not marijuana. Hemp and marijuana are two different varieties of the same plant species, but hemp does not contain high levels of THC, the chemical that makes marijuana a controlled substance.

“Much of our knowledge about how to grow, process and use hemp was lost after industrial hemp was regulated and banned along with marijuana in the 1930s,” Wolf said. “And Pennsylvania lost the benefits of an industry with a long history of providing jobs and resources here in the commonwealth. When hemp and marijuana were banned, we didn’t just lose jobs, we lost decades of research opportunities, innovation and economic growth.”

The governor was joined by Representative Maureen Madden and hemp farmer Eric Titus White.

White described how his hemp farm has provided him with economic opportunities along with a chance to literally put down roots in his home state of Pennsylvania.

“The cannabis plant is capable of stimulating our economy, healing our soil, and bringing the focus back to natural medicine and natural farming,” White said.

“I fully support the administration’s efforts to introduce the legalization of adult recreational cannabis in such a way that invests much-needed financial resources in our underserved communities and enacts restorative justice programs throughout the Commonwealth,” Rep. Madden said.

Monroe County Senator John Blake offered his support for adult-use cannabis legalization.

“I appreciate the work of the Governor and the Lt. Governor to gauge public support for the legalization of adult use cannabis and also to weigh the potential economic benefit of legalization in PA,” Blake said. “Pennsylvania’s medical marijuana program has proven to be among the best in the nation and I believe strongly that many of the protocols, regimens and controls could be replicated to ensure positive economic benefit and proper regulation of adult-use cannabis in our Commonwealth.”

Along with stressing that legalizing adult-use cannabis will create economic growth opportunities, the governor focused on how cannabis criminalization laws have disproportionately harmed minority communities in Pennsylvania, and contributed to economic harm and trauma in historically disadvantaged areas of the state.

“Every year in Pennsylvania, another 20,000 people get cannabis-related criminal charges that can keep them from getting the jobs and housing they want,” said Lt. Gov. Fetterman. “It’s time we stop ruining people’s futures over something that’s already legal in several states and something that most Pennsylvanians don’t even think should be illegal.”

“We are taking steps to reverse the injustices caused by marijuana criminalization,” Gov. Wolf said. “In 2018, I signed the Clean Slate bill, which allows for the sealing of records for certain low-level offenses if a person has been free from convictions for ten years. That law can be applied to certain marijuana-related offenses, and the Board of Pardons has expedited pardons for low-level marijuana offenses. But there is much more that needs to be done to reverse decades of injustice. And we need to start by decriminalizing cannabis and legalizing it for adult use.”

Blumenauer Calls On Supreme Court To Review Historic Appeal Challenging The Constitutionality Of Federal Criminalization Of Cannabis

DISTRICT OF COLUMBIA:  U.S. Rep. Earl Blumenauer (D-OR), founder and co-chair of the Congressional Cannabis Caucus, called upon the U.S. Supreme Court to review and proceed with hearing Washington v. Barr, the most significant and potentially consequential cannabis-related lawsuit ever to be filed.

The Court will consider the plaintiffs’ appeal at a conference on Friday, October 9, and if the Court accepts the appeal for consideration, it could pave the way to federal legalization of cannabis for the first time since 1937, providing relief to millions of Americans who treat with medical marijuana to maintain their health and lives. If the Court were to decline to hear the appeal, the case would be over for good, resigning another generation of medical marijuana patients and the state-legal cannabis industry – which has invested billions in the state-legal market – to further legal uncertainty.

“The fact that nearly 94 percent of Americans support legalizing medical cannabis and yet it remains illegal at the federal level is a national disgrace,” said Blumenauer. “Furthermore, the laws and subsequent court decisions on cannabis are a mangled patchwork of contradictions. This case is an important opportunity to fix our failed national cannabis laws.”

In July 2020, the plaintiffs in Washington v. Barr filed their appeal with the U.S. Supreme Court, challenging the constitutionality of the federal criminalization of medical marijuana. The case was filed on behalf of five plaintiffs, including former NFL player Marvin Washington, Iraq War Veteran Jose Belen, 15-year-old Alexis Bortell, nine-year-old Jagger Cotte and the Cannabis Cultural Association.

As acknowledged by the District Court in this case, Alexis, Jagger and Specialist Belen are patients whose lives have been saved by medical cannabis. As reflected in the Complaint, Marvin Washington is a cannabis entrepreneur whose business would otherwise be eligible for federal funding through the Minority Business Enterprise program, but for his participation in the cannabis industry. The Cannabis Cultural Association seeks economic parity and social justice for persons of color who have been unfairly singled out for prosecution under the Controlled Substances Act and unjustly excluded economically from the state-legal cannabis industry.

Blumenauer along with seven federal lawmakers submitted an amicus brief in support of the plaintiff’s appeal. The case also has amicus brief support from 19 advocacy groups, including the National Organization for the Reform of Marijuana Laws (NORML), the International Cannabis Bar Association, National Cannabis Industry Association (NCIA), Last Prisoner Project, Minority Cannabis Business Association, and Americans For Safe Access.

Despite its legalization by 38 U.S. states and territories, cannabis is illegal at the federal level, creating insurmountable problems for patients around the country. Patients have lost their jobs, been expelled from colleges, and lost their professional licenses, even if state-legal jurisdictions, due to cannabis stigmatization wrought by federal prohibition.

While cannabis is also on the ballot in five states that will be voting on some form of cannabis legalization in November, adoption of legalization electorally on the state level will not solve the problems associated with federal prohibition. Rather, it would merely reinforce the absurdity of marijuana’s classification under Schedule I.

To read the full amicus brief filed on behalf of Blumenauer and his Congressional colleagues, click here.

Steny H. Hoyer, House Majority Leader ‘Dear Colleague’ Update On September Floor Schedule

 Confirms Legalization On Docket For Third Week Of September

August 31, 2020

Dear Colleague:

On September 8, the House will return for its Committee Work Period, to be followed on September 14 with a busy legislative work period.  I want to thank all of you for your efforts during the August District Work Period, which involved engaging closely with constituents, community leaders, and civic organizations working hard to address the COVID-19 pandemic and other pressing national challenges.  It also involved a brief return last weekend to Washington to pass the Delivering for America Act, which would end President Trump’s sabotage of the U.S. Postal Service, a vital service to American communities and to our democracy.

While we have all been waiting for the Senate to take action on the Heroes Act, it appears that the Republicans who control that chamber are not in a hurry to do their jobs and pass an emergency assistance package to help American workers and their families get through this economic and public health crisis.  If that changes, the House will return immediately to ensure that emergency assistance is delayed no further.  I will, as stated previously, provide twenty-four hours’ notice before any Floor action. The American people need this assistance, and this will continue to be our priority in September.

Looking ahead to the week of September 14, the House will consider the following pieces of legislation on the Floor.  First, we will take up a number of bills from the Education and Labor Committee, including: Rep. Fudge’s Strength in Diversity Act, Chairman Scott’s Equity and Inclusion in Education Act, and Chairman Nadler’s Pregnant Workers’ Fairness Act.  All of these would further Democrats’ agenda of ensuring that American workers can succeed in our economy regardless of their race, sex, or background.  They are based on the premise that everyone ought to have a fair and equal chance to make it in America.  In addition, the House will also consider a bipartisan resolution offered by Rep. Meng condemning all forms of anti-Asian bias and bigotry related to the COVID-19 pandemic.

The following week, the House will take up Chairman Nadler’s MORE Act to help restore justice to millions by decriminalizing marijuana and expunging records of nonviolent federal cannabis convictions.  Additionally, the House will consider a package of legislation reported out of the Energy and Commerce Committee and the Science, Space, and Technology Committee to invest in energy innovation and clean energy development.  These bills have broad support from across the aisle and from business and environmental groups, who together recognize that Congress must lead in promoting a cleaner, more sustainable energy future that drives innovation and helps us create good jobs for American workers.  The House may also take up legislation to reauthorize our intelligence agencies and ensure that they can do their jobs free from political interference and with the latest tools to protect against foreign threats while safeguarding Americans’ civil rights.

By September 30th, Congress must complete our work on appropriations and other expiring items, such as flood insurance and surface transportation.  In July, the Democratic-led House passed legislation to fund nearly all of the government, yet to date the Senate has not held even a single markup of an appropriations bill.  At this rate, it is likely that we will have to pass a continuing resolution to keep government open past the end of this fiscal year.  While that is not ideal, the House will do its job to avert a shutdown that would only further damage our economy.

Throughout September, the Democratic-led House will show the American people what responsible governance looks like, doing its job to legislate For the People.  I thank you in advance for your hard work and contributions, and I look forward to seeing you either virtually or in person when the House returns to session.

Sincerely,

STENY H. HOYER
House Majority Leader

Office of Marijuana Policy Unveils New Details On Planned Launch Of Adult Use Marijuana In Maine

Retail sales to the public permitted to begin on or after October 9, 2020.

MAINE: The Office of Marijuana Policy, a part of the Maine Department of Administrative and Financial Services, unveiled plans for the issuance of Maine’s first active licenses for adult use marijuana establishments. The Office intends to issue the first active licenses to recreational cannabis businesses on Tuesday, September 8, 2020. Retail sales of adult use marijuana to consumers 21 years of age or older will be permitted starting on Friday, October 9, 2020.

The issuance of active licenses will continue the Office of Marijuana Policy’s structured rollout of Maine’s nascent adult use industry, which had been indefinitely postponed in April in response to the COVID-19 pandemic.

“The public’s health and safety are at the forefront of every decision we make at the Office of Marijuana Policy,” said OMP Director Erik Gundersen. “While we were poised to launch this new industry earlier this year, we were unwilling to sacrifice the high standards we have set for this program by launching during an emerging public health pandemic and in the absence of a testing facility. With the support of the public health community, municipalities across the state, and the industry we regulate, we have used the last few months to ensure this new industry is introduced to Maine consumers in a manner that is as responsible as possible.”

Active licensure is the culmination of a three-step application process which also includes conditional licensure and local authorization, respectively. An active license is required for adult use establishments to come into possession, process and sell adult use marijuana, including initiating plant transfers from Maine’s existing medical marijuana program.

It is expected adult use licensees will utilize the time between active licensure and Maine’s retail sales launch date to harvest and process marijuana, ensure those products satisfy the mandatory testing requirements, and move product through the supply chain to stock retail store shelves. Additionally, businesses which will conduct retail sales will prepare to implement and support social distancing and other public health guidance at a time when public interest may attract a significant consumer presence to their retail locations.

“Today’s announcement is a major milestone in honoring the will of Maine voters and a significant step toward launching a new industry in the state,” added Gundersen. “Many of the business owners we have spoken with during the application process are ready and eager to commence operations.”

The application process required by the adult use law requires state regulators to review application materials for form and substance, with an eye toward details such as ensuring that all applicants have completed their required state and federal criminal history record checks; that the establishment’s operation, facility, and security plans satisfy the requirements of both the Marijuana Legalization Act and the adult use program rule; and that the designated host municipality has provided the applicant with authorization to conduct business in their community.

OMP expects to issue licenses in each of the four categories of adult use establishments: cultivation, products manufacturing, retail sale, and testing. Information on the specific number of licenses issued and the identities of active licensees will be made available on Tuesday, September 8, 2020.

The Mills Administration created OMP within DAFS in February 2019. The Office is responsible for the oversight of all aspects of legalized marijuana, including Maine’s existing Medical Use of Marijuana Program.

Pritzker Administration Announces Fourth Month Sales Totals For Illinois Adult Use Cannabis

State’s new adult-use cannabis industry generated more than $37 million in sales in April

ILLINOIS: The Illinois Department of Financial and Professional Regulation has announced preliminary numbers show statewide adult-use cannabis sales in April totaled $37,260,497.89. Dispensaries across the state sold 818,954 items over the 30-day period. Sales to Illinois residents totaled $29,735,650.41, while sales to out-of-state residents totaled $7,524,847.47. These figures do not include taxes collected. A portion of every cannabis sale will be reinvested in communities harmed most by the failed war on drugs.

Medical and adult use cannabis dispensaries remain open as part of the essential businesses and operations named in Governor Pritzker’s executive order signed on March 20, 2020. Both sides of the cannabis industry were included to ensure the cannabis supplier industry protects medical cannabis patients during the COVID-19 pandemic. Additionally, the revenue generated by adultuse cannabis sales funds the important social justice and equity goals at the core of Illinois’ adult-use law.

“Our top priority is to ensure consumers are safe when they go to a dispensary to purchase cannabis,” said Toi Hutchinson, Senior Advisor for Cannabis Control to Gov. Pritzker. “The steps we’ve taken to increase social distancing at dispensaries are accomplishing that, while also enabling this new industry to continue to grow. As such, curbside pickup will remain an option for medical cannabis users to obtain the product they need through May 30.”

Dispensaries are permitted to sell medical cannabis outside of their limited access area on their property or on a public walkway or curb adjacent to the dispensary. Medical cannabis patients will be able to continue to utilize their designated caregiver to purchase medicine for them. However, dispensaries may not deliver medical cannabis to a patient or caregiver’s home. These rules do not apply to adult-use cannabis sales; those must still take place inside the limited access area. A complete list of the rules extended may be found here.

Congressman Riggleman Sends Letter To Secretary of Agriculture, Sonny Perdue, On Hemp Production

DISTRICT OF COLUMBIA: Congressman Denver Riggleman sent a letter to Secretary of Agriculture, Sonny Perdue, to discuss potential changes to the implementation of the U.S. Domestic Hemp Production Program.  The letter suggested improvements to benefit farmers and align the rules with the realities that hemp farmers face while growing.

“Virginia and the 5th District are uniquely positioned to lead in the arena of hemp production and I am grateful to the entire Virginia delegation for signing this letter regarding the U.S. Domestic Hemp Production Program,” said Congressman Riggleman.  “Industrial hemp is a potential game changer for Southside Virginia.  If we can improve the USDA hemp program to help Virginia farmers, we have the potential to bring huge economic growth to the 5th District.  This letter will provide clarity for farmers and help production.”

Congressman Riggleman’s letter was cosigned by the Virginia delegation in the House of Representatives. The changes it asked for would reduce regulation surrounding hemp farming as well as its post production and distribution.

You can read the full letter here.

FSD Pharma Appoints Former Member Of U.S. Congress To Its Board of Directors, Announces Share Consolidation

CANADA: FSD Pharma announced the appointment of former U.S. congressman Stephen Buyer to the Company’s Board of Directors. The Company also announced that it will complete a consolidation of its class A multiple voting shares and its class B subordinate voting shares each on a 1 to 201 basis.

“In welcoming Steve Buyer to the FSD Pharma Board of Directors and announcing a share consolidation, the Company has made an immense positive stride forward” said Raza Bokhari, MD, Executive Co-Chairman and CEO. “Steve’s addition has further strengthened the independence and profile of the FSD Pharma Board of Directors; his broad leadership experience and pharmaceutical industry relationships will help enhance our visibility, especially among U.S. Institutional investors and on U.S. Capitol Hill. The share consolidation or reverse split of our stock is timed to advance our strategic plan to raise the profile of our company in the U.S. capital markets, which includes listing on a major U.S. stock exchange in the near future” continued Dr. Bokhari.

“I’m pleased to be joining the FSD Pharma Board of Directors. The opportunity to participate in FSD’s growth at this stage is exciting. Unfortunately, auto immune diseases have clustered in my wife’s family. I am attracted by FSD’s medical research to tame and define the unknown by challenging the edges of medical science to provide relief to people suffering from fibromyalgia and other serious illnesses,” stated Mr. Buyer.

Stephen Buyer was a member of the United States House of Representatives, serving nine consecutive terms from January 1993 to January 2011. During Congressman Buyer’s long tenure in the Congress, he served on the Committees on Veterans Affairs, Armed Services, Judiciary, Energy and Commerce Committees and also served on the Military Compensation and Retirement Modernization Commission. He is presently the Managing Partner of the 10-Square Solution, LLC, focusing on business development, mergers and acquisitions, and representation before the federal government.

Congressman Buyer served as Chairman of the Committee on Veterans Affairs for the 109th Congress, as well as the Ranking Minority Member for the 110th and 111th Congresses. He centralized the VA’s IT architecture and was named to the Federal IT top 100. Congressman Buyer also served on the House Armed Services Committee from 1993 to 2001, including as Chair of the Subcommittee on Military Personnel in the 105th and 106th Congresses. He founded and co-chaired the National Guard and Reserve Components Caucus. He created the renewable energy portfolio for the Department of Defense and Veteran Affairs. He was the architect of TRICARE For Life and authored the U.S. military’s pharmacy redesign. His other Congressional assignments included service on the Health, Energy, and Technology subcommittees of the Committee on Energy and Commerce from 2001 to 2010, where he assisted in creating Medicare Part D, authored the electronic pedigree pharmaceuticals distribution system, served as a House Conferee on the Telecommunications Act of 1996, and lead the Congressional effort to reorganization of the U.S. Olympic Committee. He also served the House Committee on Judiciary from 1993 to 1999.

Congressman Buyer, as an Army Reserve officer, served four years on active duty, including a tour of duty in Iraq during the first Gulf War (1990-91) where he was awarded the Bronze Star as an Operational Law Judge Advocate. Prior to JAG, he was a Medical Service Corps Officer for 4 years. Congressman Buyer, after 30 years of service, retired with the rank of Colonel in the U.S. Army Reserve Judge Advocate General Corps.

Prior to his tenure in the United States Congress, Congressman Buyer served as a Special Assistant United States Attorney, Indiana Deputy Attorney General, and engaged in a private law practice.

Congressman Buyer is a distinguished military graduate of The Citadel in 1980 with a B.S. degree, and received his J.D. from Valparaiso University School of Law in 1984. He is a member of the Indiana and Virginia state Bars.

In addition, FSD is pleased to announce that its Board of Directors has approved the Consolidation on a 1:201 basis. Effective October 16, 2019, with a record date of October 17, 2019, the Company expects to begin trading the Class B Shares on the Canadian Securities Exchange on a post-Consolidation basis under its existing name and ticker symbol. The new CUSIP and ISIN for the Class B Shares are 35954B206 and CA35954B2066, respectively.

The Company currently has 1,582,966,252 Class B Shares outstanding and the Consolidation will reduce the issued and outstanding Class B Shares to approximately 7,874,809 Class B Shares. The Consolidation was approved by FSD shareholders at the Company’s special meeting held on January 22, 2019, and will allow the Company to continue to pursue the listing of the Class B Shares on a major U.S. exchange.

The Company will not be issuing fractional post-Consolidation FSD Shares in connection with the Consolidation. Where the Consolidation would otherwise result in a shareholder being entitled to a fractional FSD Share, the number of post-Consolidation FSD Shares issued to such holder of FSD Shares shall be rounded down to the nearest whole number of FSD Shares. In calculating such fractional interests, all FSD Shares held by a beneficial shareholder shall be aggregated.

A letter of transmittal with respect to the Consolidation will be mailed to registered shareholders of the Company. All registered shareholders with physical certificates will be required to send their certificates representing pre-Consolidation FSD Shares along with a completed letter of transmittal to the Company’s transfer agent, Computershare Investor Services Inc. (“Computershare”), in accordance with the instructions provided in the letter of transmittal. Additional copies of the letter of transmittal can be obtained through Computershare. All shareholders who submit a duly completed letter of transmittal along with their pre-Consolidation FSD Share certificate(s) to Computershare will receive a post-Consolidation share certificate. Shareholders who hold their FSD Shares through a broker or other intermediary and do not have FSD Shares registered in their name will not need to complete a letter of transmittal.

The exercise or conversion price and the number of FSD Shares issuable under any of the Company’s outstanding warrants and stock options will be proportionately adjusted to reflect the Consolidation in accordance with the respective terms thereof. After the Consolidation, there will be approximately 1,033,782 stock options and warrants to purchase 576,499 Class B Shares outstanding.

The Class A Shares will also be consolidated on a 1:201 basis, such that post-Consolidation there will be 72 Class A Shares issued and outstanding, each Class A Share representing 276,660 votes on all matters. Based on the current issued and outstanding number of FSD Shares, the Class A Shares collectively represent approximately 72% of the voting rights.

DEA Announces Steps Necessary To Improve Access To Marijuana Research

DISTRICT OF COLUMBIA: The Drug Enforcement Administration today announced that it is moving forward to facilitate and expand scientific and medical research for marijuana in the United States. The DEA is providing notice of pending applications from entities applying to be registered to manufacture marijuana for researchers. DEA anticipates that registering additional qualified marijuana growers will increase the variety of marijuana available for these purposes.

Over the last two years, the total number of individuals registered by DEA to conduct research with marijuana, marijuana extracts, derivatives and delta-9-tetrahydrocannabinol (THC) has increased by more than 40 percent from 384 in January 2017 to 542 in January 2019. Similarly, in the last two years, DEA has more than doubled the production quota for marijuana each year based on increased usage projections for federally approved research projects.

“I am pleased that DEA is moving forward with its review of applications for those who seek to grow marijuana legally to support research,” said Attorney General William P. Barr.  “The Department of Justice will continue to work with our colleagues at the Department of Health and Human Services and across the Administration to improve research opportunities wherever we can.”

“DEA is making progress in the program to register additional marijuana growers for federally authorized research, and will work with other relevant federal agencies to expedite the necessary next steps,” said DEA Acting Administrator Uttam Dhillon.  “We support additional research into marijuana and its components, and we believe registering more growers will result in researchers having access to a wider variety for study.”

This notice also announces that, as the result of a recent amendment to federal law, certain forms of cannabis no longer require DEA registration to grow or manufacture. The Agriculture Improvement Act of 2018, which was signed into law on Dec. 20, 2018, changed the definition of marijuana to exclude “hemp”—plant material that contains 0.3 percent or less delta-9 THC on a dry weight basis. Accordingly, hemp, including hemp plants and cannabidiol (CBD) preparations at or below the 0.3 percent delta-9 THC threshold, is not a controlled substance, and a DEA registration is not required to grow or research it.

Before making decisions on these pending applications, DEA intends to propose new regulations that will govern the marijuana growers program for scientific and medical research. The new rules will help ensure DEA can evaluate the applications under the applicable legal standard and conform the program to relevant laws. To ensure transparency and public participation, this process will provide applicants and the general public with an opportunity to comment on the regulations that should govern the program of growing marijuana for scientific and medical research.

The Notice of Application is available here:

Rep. Tulsi Gabbard Introduces 2019 Hemp For Victory Act

DISTRICT OF COLUMBIA: Rep. Tulsi Gabbard (HI-02) introduced H.R. 3652, the Hemp for Victory Act which lays the foundation for the emerging hemp industry in a manner that incentivizes family farmers and small businesses, protects against corporate monopolies, and studies the benefits of hemp cultivation and hemp-based products while ensuring safe agricultural practices, and environmental and labor considerations.

“The hemp industry is poised to grow rapidly, having a billion dollar impact on the U.S. economy and creating thousands of jobs. Hemp-based materials have the potential to transform industries from health care to domestic manufacturing to affordable, sustainable housing construction, and more. Studies have shown it can play a role in helping remove toxins from our environment and prevent soil erosion, as well as provide alternatives to single-use plastics, which pollute our lands and ocean,” said Rep. Tulsi Gabbard. “My bill will lay the foundation for how we can optimize the hemp industry’s potential and ensure this opportunity benefits family farms and small businesses across America — from Hawai‘i to Kentucky and beyond.”

“Congresswoman Gabbard’s commitment to re-energizing the American farmer and delivering on the economic and planetary healing promise of the versatile, valuable hemp plant is exactly what our nation needs, and the time is now to support her bold efforts,” said Joy Beckerman, a board member with the Hemp Industries Association.

“We commend Congresswoman Gabbard for her leadership on introducing the Hemp For Victory Act,” said Eric Steenstra, President of Vote Hemp. “The fledgling hemp industry can create thousands of farming and manufacturing jobs but needs research and the same support given to other crops which the bill helps provide.”

hemp_for_victory_big

Background: H.R. 3652, the Hemp for Victory Act of 2019, named after the World War II-era effort to revitalize the U.S. hemp industry, broadly addresses many aspects of the re-emerging U.S. hemp industry. The legislation’s objective is to build and encourage a national hemp industry, but to ensure that is done correctly, meaning that there are proper labor, consumer, and health standards; investment incentives; safe agricultural practices; environmental considerations; and more. At its core, the bill is aimed at providing opportunities for small businesses, family farms, indigenous populations, and veterans to participate in and prosper from this industry.

The bill will engage the expertise of several U.S. agencies, as well as land-grant universities, in order to lay the foundations of and generate the demand necessary for our hemp industry to ensure domestic economic potential is met across several sectors. Recognizing the potential for this commodity to grow into a multi-billion dollar industry, the bill directs the U.S. Departments of Agriculture, Health and Human Services, Defense, Labor, Housing and Urban Development, Veterans Affairs, Environmental Protection Agency, and Small Business Administration to conduct research and develop studies on the uses and benefits of hemp. This includes preservation and rehabilitation of our environment through toxic site cleanup and soil erosion control, sustainable and affordable housing, nutritional benefits to our children in school lunches and healthcare benefits to our veterans, alternatives to single-use plastics to reduce our ecological footprint, and the creation of thousands of jobs, among so many more.

 

Rep. Tulsi Gabbard was an original cosponsor of H.R. 3530, the Industrial Hemp Farming Act, a stand-alone bill in the 115th Congress which would have reclassified hemp as an agricultural crop. She supported H.R. 2, the Agriculture Improvement Act of 2018 — more broadly referred to as “the Farm Bill” — which passed both the House and Senate with strong bipartisan majorities and was signed into law. Among its many provisions, the bill legalized the production of industrial hemp and put its regulation under the U.S. Department of Agriculture.

Rep. Gabbard supports empowering local farmers and expanding their opportunities. She also joined a bipartisan amicus brief asking the Court to recognize and uphold the Congressional intent of prior legislation that allowed states to grow, cultivate, and research industrial hemp under specific conditions.

New Jersey Requesting Applications For 24 ATC Endorsements – What Applicants Need To Know

By: Rosemarie Moyeno Matos, Esq.

NEW JERSEY: Hot on the heels of Governor Phil Murphy’s May 2019 announcement that his administration would be moving forward with expansion of New Jersey’s Medicinal Marijuana Program (the “MMP”), the Department of Health (the “DOH”) published a new Request for Applications (the “RFA”) for new alternative treatment center (“ATC”) permits and endorsements on July 1, 2019. It’s important to note that this RFA process still falls under the purview of the New Jersey Compassionate Use Medical Marijuana Act (“CUMMA”),[1] despite Governor Murphy signing the “Jake Honig Compassionate Use Medical Cannabis Act” (the “Act”) into law on July 2, 2019. The Act will eventually turn oversight of the MMP from the DOH to a Regulatory Cannabis Commission upon its creation.

Pursuant to the RFA, the DOH will award up to 24 permits and endorsements for cultivation, manufacturing and dispensary operations throughout the northern, central and southern regions of the state. This article will summarize the RFA requirements and any significant differences from prior application requirements.

NUMBER OF ENDORSEMENTS BY REGION & OPERATION:

For the first time since the inception of the MMP, the state will be issuing separate “permit endorsements” for cultivation and dispensing operations, presenting an opportunity for small businesses and minorities to enter the industry on a smaller, more affordable scale. The RFA is looking to award:

Total Permit/Endorsements Type of Permit/Endorsement
4 Vertically Integrated Permits (“VIPs”)[2]
15 Dispensary Endorsements
5 Cultivation Endorsements[3]

The 24 ATC permits and endorsements awarded under the RFA are to be distributed regionally and by operation in the following manner:

Region Number and Type
Northern (Warren, Morris, Essex Counties and up):2       Cultivation Endorsements5       Dispensary Endorsements1-2    VIPs*
Central (Hunterdon, Somerset, and Union through Mercer and Ocean Counties):2       Cultivation Endorsements5       Dispensary Endorsements1-2    VIPs*
Southern (Burlington and Atlantic Counties all the way down):1       Cultivation Endorsements5       Dispensary Endorsements1-2    VIPs*

*One VIP will be awarded in each region. The region of the 4th VIP will be determined at the time of award based on the applicant’s overall score and patient need.

Except for VIP permits, each individual endorsement requires a separate application. Applicants should note:

  • you are limited to a maximum of three (3) applications, one (1) per region;
  • you may not submit for a VIP and for individual endorsements;
  • you may only submit for one (1) cultivation endorsement; and
  • you will only be awarded one (1) VIP or one (1) individual endorsement.

APPLICATION COSTS:

Two checks totaling $20,000 must accompany each application submitted. The checks represent a $2,000 non-refundable application processing fee and the $18,000 permit endorsement fee if awarded. The DOH will destroy the $18,000 checks submitted by applicants not awarded an endorsement.

In addition to application fees (up to $24,000 depending on the number of applications submitted and whether a permit/endorsement is awarded), applicants will need typically need budget for real estate, professional services and contractors, and construction costs. Property and construction costs vary depending largely factors such as location and form of interest (lease vs ownership). Professional or contractor’s costs largely depend on the fees of each professional or contractors and the specific needs of the applicant, but an applicant can realistically expect to pay well over $100,000 for professional and contractor services leading up to and during the application process.[4]

APPLICATION REQUIREMENTS:

Similar to last year’s permit applications, current applications will consist of Part A Mandatory Information, Part B Scored Criteria and Personal History Disclosure Forms for each owner with 5% or more ownership interest in the ATC, as well as each principal, director, board member, and employee.

Part A Mandatory Information largely seeks entity and property information including listing of all individuals and entities having greater that 5% ownership interest in the ATC, all creditors and all individuals and entities having managerial/operational control over the ATC. Applicants will also need to include all formation documentation, all contracts related to management, intellectual property, real estate, equity in, or funding of applicant, Letters of Support and evidence of zoning compliance, site plans and a list of its medical advisory board members with a copy of the board’s by-laws.

Part B Scored Criteria (300 points) includes:

1.   Submission of security, environmental impact and quality control and quality assurance plans (30 pts);

2.   ATC’s compliance history in government-regulated marijuana programs or other highly regulated industry (20 pts);

3.   Financial plan/proof of funding evidencing applicant’s ability to meet supply demand (20 pts);

4.   Evidence of community support and participation (20 pts);

5.   Ability to provide appropriate research data through evidence of past contributions (10 pts);

6.   Compliance experience in cultivating, manufacturing, or dispensing marijuana, as applicable, in government-regulated marijuana programs (100 pts); and

7.   Submission of labor peace agreement, labor compliance plan and a workforce and job creation plan with evidence of WBE, MBE or VOB certifications (100 pts).[5]

IMPORTANT DATES:

Action Date
Application Opening Period on or before July 15, 2019
RFA Question Submission Deadline July 26, 2019
Pre-Application Webinar August 2, 2019
Dispensary Apps Submission Deadline 3:00 pm EST on August 21, 2019
Cultivation & VIP Apps Submission Deadline 3:00 pm EST on August 21, 2019
Final Agency Decision None Provided

CONCLUSION: While the number of endorsements to be issued from the June 3rd RFA (108) versus this RFA (24) dropped significantly, there is reason to believe that additional RFAs will be published soon after the Regulatory Cannabis Commission is established and operational, as the medicinal marijuana  patient population continues to grow in leaps and bounds. The question we frequently receive from interested applicants is whether they should be preparing for this application round or future rounds. The answer depends largely on where the applicant stands with its business plan, site control, capital and team (including owners, managers, and employees, as well as outside professionals and contractors). However, if you are not application ready for this round, you should actively continue to work toward it for the next. If history has taught us anything, an applicant truly vested in this space should be preparing themselves to be application ready at a moment’s notice since RFAs tend to drop with little to no advance warning!

The law firm of Moyeno Gonzalez & Associates PC has represented previous applicants in this space and is ready to assist in answering any questions you may have regarding the RFA, the application process and post-licensing compliance. Please feel free to reach out to us via our website.

In her current role as Partner at Moyeno Gonzalez, Rosemarie Moyeno Matos represents both for-profit and non-profit organizations, rendering a wide range of legal services from entity selection and formation to regulatory compliance advice and commercial transaction representation. In August 2018, she represented a client who submitted two applications for vertically integrated Alternative Treatment Center licenses through New Jersey’s Medicinal Marijuana Program. Currently, she represents several entrepreneurs and start-ups in the medical and recreational cannabis space. Through her corporate and regulatory background, Rosemarie has a keen awareness of the issues faced by those participating in the cannabis industry and successfully helps her clients navigate them.
[1]N.J.S.A. 24:6I-1 et seq.
[2] VIPs include one (1) each of a cultivation endorsement, a manufacturing endorsement and a dispensary endorsement.
[3]Cultivation Endorsements are further broken down by tiers based on canopy size. Of the 5 individual Cultivation Endorsements awarded under this RFA, endorsements will be awarded based upon canopy size in the following manner:
1       for a Canopy up to 5,000 ft2
2       for Canopies between 5,001 ft2 and 20,000 ft2; and
2       for Canopies between 20,001 ft2 and 30,000 ft2.
VIP applicants are not restricted to canopy tiers and may choose any canopy size up to 30,000 ft2.
[4]Additional capital needed to evidence financial suitability and to commence operations are not factored into these application costs.
[5] Applicants who fail to submit a signed labor peace agreement will lose 30 points. Additionally, applicants who submit proof of WBE/MBE/VOB certifications will receive full credit of 30 points, while those who submit evidence of meeting the criteria in the future may receive partial credit.